USDCAD: Stabilized for now - TDS

FXStreet (Delhi) – Research team at TDS, note that the USDCAD pair looks to have stabilized, for now and they are watching for a break to the downside is 1.2950/70 area which is key near-term support.

Key Quotes

“A clean break below would open up downside potential to 1.2800 but we think that USDCAD may be in the process of forming a base. Even though our high frequency fair value model suggests spot should be trading closer to 1.2885 we would be careful in chasing it lower given the washout in USDCAD longs over the past few trading sessions (which were not overly extended to begin with at least according to the IMM data).”

“Rate spreads continue to be the driver of the valuation gap but we tend to find that when spot sits about two standard deviations away from FV that a correction takes place. So, for all intents and purposes, we think the bulk of the move lower in USDCAD has been largely observed.”
For more information, read our latest forex news.

Useful Searches

Disclaimer - Forex, futures, stock, and options trading is not appropriate for everyone. There is a substantial risk of loss associated with trading these markets. Losses can and will occur. No system or methodology has ever been developed that can guarantee profits or ensure freedom from losses. No representation or implication is being made that using the information contained on this site will generate profits or ensure freedom from losses.